Watlington completes Somerset pipeline loop
A water supply pipeline loop around Somerset Island has been completed by Watlington Water.
The company has installed more than 40,000 feet of new pipeline in the western parishes since July 2010, and finished the Somerset loop earlier this year, according to a directors' report.
This year Watlington saw its best first half-year performance, in terms of gross and net earnings, since the start of the recession, according to the report.
In the six months that ended on June 30, the company recorded a gross profit of $3,712,525, up about $119,000 on the same period in 2014. After subtracting expenses and adding finance income, the profit attributable to the owners was $1,050,587, up about $83,000 year-on-year.
Earnings per share rose to 99 cents from 91 cents a year ago.
A strong third quarter is anticipated by the company, with the added expectation of an upswing in demand linked to next month's America's Cup races on the Island.
The directors' report stated: “Four of the first six months this year were up on the same period last year.
“Operating expenses have increased but the investments made to improve infrastructure and efficiencies have helped to constrain expenses, and the improvements seen last year in gross profit margin, have continued to contribute to stronger net earnings.”
The company said that metered water sales comprise approximately two thirds of revenue, so its overall success is closely tied to rainfall levels — with demand higher during dry spells.
The third quarter of the year normally sees strong demand, according to the company.
“This year we have experienced a prolonged intensifying dry spell that was suddenly ended by heavy rains,” stated the directors' report.
“June was a very strong month for the company that continued into July until the rains started. Again this year, late July and August rains have filled all tanks thereby significantly reducing demand.
“Early third quarter results have shown an improvement on the same period last year. As was the case at the same stage last year, it will take another period of dry weather to reestablish substantial demand.
“The company is anticipating, like many others, that there will be an interim upswing in demand for our products that is not weather related in October as a consequence of the series of America's Cup races to be sailed from Hamilton.”
Watlington Water reported that demand has, so far, been stronger during the initial part of the third quarter.